Medicinal plants and their products are among the most valuable natural resources in Iran, yet they have received limited attention in economic studies and market power analysis. Scientific knowledge, along with the cultivation, development, optimal utilization, and management of their production and export, can play a crucial role in improving non-oil export development indicators. Considering the significance of analyzing market structure in the industrial sector-which holds a major share of production value, added value, and employment, particularly in developed economies. this study assesses the efficiency of 55 firms operating in Iran’s medicinal plants processing industry. This assessment is carried out using Data Envelopment Analysis (DEA), the Structure-Conduct-Performance (SCP) framework, and market concentration measured by the Herfindahl-Hirschman Index (HHI), employing GAMS and SHAZAM software. The purpose of analyzing market structure and eva‎luating competition and concentration in this industry is to show that in industries with broad competition, where market power is distributed among multiple decision-making units, a greater variety of products and better pricing are achieved compared to highly concentrated industries. Monopolies, by contrast, undermine the business environment and impede a country's path to industrialization. The efficiency results revealed an average efficiency score of 1, with a minimum efficiency score of 0.17, and a coefficient of variation of 4.06. Findings from the SCP model indicated a significant and inverse relationship between structure (market share) and performance (profitability). In the conduct equation, none of the factors. profitability, efficiency, or market share-significantly affected the intensity of advertising and research, underscoring serious challenges in advertising and research within Iran's medicinal plants processing industry in 2021 and reflecting the absence of a coherent regulatory framework. In the performance equation, both market share and efficiency were found to influence profitability, with a positive relationship between profitability and efficiency and an inverse relationship between profitability and market share. Additionally, a bidirectional and positive relationship between profitability and efficiency was observed, confirming the interconnection between structure and performance. The results of the Herfindahl-Hirschman Index further indicated that this industry is decentralized.

3/2/2024 12:00:00 AM

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معصومه فلاح